FOR IMMEDIATE RELEASE: Thursday, March 16
CONTACT: Sara Wurfel, 517-599-3470 or email@example.com
Proposed incentive program tailored to create a critical job attraction tool for large-scale projects in communities across state
LANSING, Mich. – Michigan must have a more competitive tool to grow more good-paying jobs statewide and not be left on the sidelines behind other states, said numerous economic development experts and other leaders from across the Great Lakes State today. They also emphasized the need for Michigan to take advantage of what is expected to be a surge of new investment in the United States, including repatriated jobs, over the next few years.
At a roundtable discussion in Lansing, members of the Good Jobs for Michigan Coalition urged support for SBs 242, 243 and 244, legislation that would use transparent incentives to fill critical gaps in Michigan’s business attraction toolkit and enable the state to secure large-scale projects that create hundreds of new good-paying jobs.
“Michigan has made great strides in turning our economy around, but there is more that can and must be done. The headlines have been loud and clear from across the country – as has the feedback from our local economic developers and national site selectors. Michigan can’t afford to sit on the sidelines and let other states lure businesses away that should be coming here,” said State Sen. Jim Stamas. “The Good Jobs for Michigan legislation being re-introduced this week will ensure Michigan can compete – and win – large projects with good-paying jobs in communities statewide, from Midland to Marquette and Montmorency County to Monroe.”
Michigan needs to be ready
For State Sen. Ken Horn, chair of the Senate Economic Development and International Investment Committee, the timing and need for the legislation is critical as the national climate heats up with more companies looking to bring jobs back to the United States. “These bills are essential to Michigan’s ability to compete nationally, especially as the competition for this increased investment between states escalates. They put Michigan, our economy and communities, and Michiganders first. We’ll be able to grow more good-paying jobs for our workers and families.”
Horn also noted that they are a natural complement – and essential counterpart – to the recently passed Michigan Thrive Initiative of brownfield redevelopment. “One is designed to revitalize long-struggling sites and create attractive places for investment, the other helps fill the buildings the brownfield legislation creates with good-paying jobs.”
Ensuring Michigan is “on the list”
“When companies are evaluating locations, if all other factors – including the state’s business and regulatory climate, workforce talent pool and infrastructure are equal, incentives can absolutely impact the location decision of the project,” said site selection expert Dan Foster, senior managing director of Newmark Grubb Knight Frank Global Corporate Services. “Too often, Michigan is knocked off the list for large-scale projects even though the state has everything else needed for a successful business. This is not a partisan issue, it’s a jobs issues. The national and global competition for jobs and capital investment is fierce. If Michigan is serious about winning these jobs, it needs a strong incentive package.”
For Whirlpool Corporate Vice President D. Jeffrey Noel, this race for jobs is real. Over the last 100+ years, his Michigan-based company has grown from humble beginnings to become the world’s largest and most innovative home appliance company, with its company headquarters still operating out of Benton Harbor Township.
“Whirlpool is proud to be headquartered in Michigan with over 4,000 employees. We’re committed to the state and our heritage here,” said Noel. “Our ability to attract and retain world class talent is made challenging if trailing partners do not find the kinds of employment options they seek or if they are asked to live in a community that is not growing. Michigan needs competitive incentives to attract and grow solid paying jobs, and from our experience doing business in virtually every state, we simply do not have a winning set of tools to attract the kinds of jobs that enable growth and support Michigan employer’s like us.”
Data shows that many competing states, including neighboring states like Indiana and Ohio and southern states like Kentucky and South Carolina, are outspending and outcompeting Michigan up to 7 to 1.
Bolstering communities statewide
The Good Jobs for Michigan legislation is supported by local economic developers working throughout the state.
“As an organization whose role is to strengthen the economic vitality of the Saginaw area by recruiting businesses to locate here, I see and hear first-hand how difficult it is to lure these large-scale businesses to our region – a sentiment too often echoed from my counterparts throughout the state,” said Saginaw Future President JoAnn Crary. “Michigan needs to confront this harsh reality head on if we are going to continue the positive economic momentum. We must act swiftly, or Michigan will continue to lose major opportunities to grow good-paying jobs to places like Columbus, Indianapolis, Milwaukee and cities in the southern states.”
For municipalities, the legislation provides net revenue gain and offers a smart way to benefit communities in every corner of the state.
Sterling Heights City Manager Mark Vanderpool and board trustee for the Michigan Municipal League said the legislation’s provisions ensure that local communities will be full partners in projects and that added property tax and sales tax revenues as a result of new jobs and increased economic activity are important components: “A tailored incentive like this will generate positive statewide impact and help strengthen our schools, spur better infrastructure and advance safer and more vibrant communities. We urge the Legislature’s action.”
For the Michigan Building and Construction Trades Council, it’s simple and comes down to a jobs issue. It’s also why their labor organization representing 15 building trades unions with over 100,000 members statewide are so supportive. “This proposal is good for growing jobs for Michigan workers and good for growing wages, which both benefit our state’s families and communities. It’s time to get this done for Michigan’s hard-working men and women and put our state on the path for a strong, successful future,” said Patrick “Pat” Devlin, the Council’s secretary-treasurer.
How it works; Transparency, accountability and built-in fiscal protections
The Good Jobs for Michigan legislation, slated to have its first hearing on Thursday, March 16, will create a transparent and performance-based tax incentive program that does not favor industry over the next, but instead, focuses on large-scale projects bringing 250 or 500-plus good paying jobs to our state.
Under the legislation, business expansions or new locations that create a minimum of 500 new jobs and pay 100 percent or more of the average regional wage would be eligible to capture up to half of the personal income tax (PIT) withholding of new employees for up to five years. Those creating 250 new jobs and paying 125 percent or more of the average regional wage would be eligible to capture up to 100 percent of the PIT withholdings for up to 10 years.
Other key provisions include:
- Companies will not receive the incentive until they meet the minimum job and wage thresholds required. Both jobs and wages will be verified every year until the incentive expires.
- A third-party analysis must demonstrate overall positive fiscal impact to the state.
- The business/project must receive a letter of support from the chief executive of the local unit of government where the project would expand or be located.
- The program/incentive details will be public information.
- A total 15 projects per year could be authorized with a cap of $250 million for all projects at any one time.
Stamas noted how different this incentive is from the previous MEGA tax credits.
“This legislation was designed to have essential safeguards that protect the state, hardworking taxpayers and our communities,” Stamas said. “It’s simple. It’s transparent. It’s predictable. And it’s performance based – businesses will not benefit unless jobs are created. Let’s get this done and ensure Michigan can bring more good-paying jobs right here at home.”
For more information about the Good Jobs for Michigan legislation and full list of coalition partners, visit www.GoodJobsForMichigan.com.
About Good Jobs for Michigan
Good Jobs for Michigan is a coalition of more than 40 leading business and economic development, community and labor organizations all working together to ensure Michigan has the economic development and incentive tools needed to compete and attract large-scale projects, growing more good-paying jobs and investments in communities throughout the state.